Ideas Matter

Where Communism Still Lives

Around the world, pockets of communists still cling to power. They're either smaller regimes run by a cadre of strongmen, or they have evolved into what has come to be known as "state capitalism." In this latter form, cronyism is considered a feature not a bug. The question for me is: will these pockets of communism linger? Or will they linger for a while, but eventually evolve into another form? And is state capitalism becoming the dominant form for the globe?

Resolving the Immigration Paradox

Immigration is a tough issue. Ben Powell makes a strong economic case for open immigration here. After all, labor is a market. And the market mechanism has a way of reallocating labor in ways that is beneficial for everyone.

Yet we know that there are generous welfare programs in many states that mean immigants can come illegally and gain access to costly social services. If a robust welfare state is available to all comers, this is -- of course -- unsustainable (as it has been in Europe). This was essentially Milton Friedman's more pragmatic position. And he has a point. That is, he was for open immigration as long as the welfare state could be dismantled. And of course it isn't.

So how might we cut this immigration Gordian Knot?

Economies in Transition: A Question of Institutions

Since the collapse of the Soviet Union, some countries have done better than others. The question of whether capitalism has succeeded or failed in these countries is the degree to which the countries have actually embraced capitalism. In other words, institutions matter. And some countries adopted better rules than others. Adding to Professor Yakovlev's analysis, let's consider some of the evidence.

Free To Choose: Mart Laar's Economic Guidebook for Estonia

An economy in ruins. The young prime minister was facing unbelievable odds. Mart Laar knew little about economics. He turned to one book: Free To Choose, the book based on the film. And the rest, as they say, is history.

Milton Friedman: "Unfair" Competition and Special Interests

It was a coincidence that we selected a clip from Free To Choose on protectionism and economist Don Boudreaux offered this letter to the New York Times in the same week:

Alan Tonelson complains that the Chinese demand from us Americans too few of our exports in exchange for the imports that we receive from China (Letters, Dec. 21).

To remedy this situation, a simple two-step solution is available.  First, Uncle Sam should mandate that American producers double the amount of goods they ship to China.  Second, because the Chinese won't accept such a large volume of American outputs, Uncle Sam should mandate also that captains of freighters en route from the U.S. to China dump half of their cargoes overboard in the middle of the Pacific.

 

Free or Equal: A Perfect Way to Celebrate 2012

We're only two and a half months away from Milton Friedman's Century. Many of you want to celebrate the 100th centennial of Friedman's birth, but you haven't figured out just how yet.

Consider a screening of Free or Equal in your club, community group, church or non-profit organization. The excerpts above will give you an idea of what you see.

Once you've decided how to celebrate, tell us here. We want to share your participation with the world!

You get the classic mixed with the new in this documentary that deals with the critical choice a people must make between freedom and equality. Host Johan Norberg walks in Friedman's footsteps to test the latter's ideas 30 years after the original airing of Free To Choose on PBS.

Michael Sandel Underestimates the Power of Choice

What I love about the Internet Age is that you and I can take a high-brow Harvard philosopher like Michael Sandel to task. Let's do that today.

He's right about one thing: the global economy and global communications apparatus means that Sandel is, himself, not standing in his local agora. He's talking to people all over the world. Indeed, I am critiquing him from thousands of miles away on a machine that was manufactured in hundreds of different places around the world. So yes, the scale of the global economy is such that the project of self-government is not entirely local, as the saying goes. But that's probably where our agreement ends.

Hernando de Soto in the Classroom

Time for a little company business. Just think of this as a low-budget, liberty-loving infomercial.

Did you know that one of our most powerful and successful initiatives at Free To Choose Network is our izzit.org website? Through izzit, we market the highest quality DVDs to teachers. Above you'll find an excerpt from our educational DVD "Markets Without Borders," featuring Hernando de Soto. In it, de Soto discusses the institutions that help the world's poorest people rise out of poverty.

Since July, izzit has shipped more than 17,000 DVDs just like this to U.S. teachers. (We're also going international -- currently in Slovenia and next year in Sweden.) In a single year, we will ship more than 80,000 liberty-themed DVDs to U.S. teachers.

Made in ... Who Cares?

Markets, like any other vascular system, seek to flow. Global markets are no different. When people find goods and services they value, they find it difficult to see borders (or nationality or race or creed). Economists like Don Boudreaux figured this out long ago. But why is the protectionist instinct still so strong in so many?

Peter Singer: Intentions v. Consequences

What's so bizarre about this is that Peter Singer never bothers to ask why poor people are poor. 

He seems to labor under the idea that the poor need more resources in order to pull themselves out of poverty. And yet, as Charlie Rose points out, the track record of foreign aid is abysmal. Intellectuals like Singer are obsessed with their own ideals -- so much so that they never bother to look at the consequences of their idealism when put into practice.

They don't see that dropping money from the heavens does not create sustainable wealth creation. They don't realize that foreign aid has done more harm than good (if you pay people to subsist, they will subsist). They fail to acknowledge that predatory governments create perverse systems -- rife with corruption and political patronage, not free exchange or entrepreneurism.

If the correct institutions and incentives were in place in the poorest parts of the world, the poor would not need "more resources." Just ask Hong Kong. From education to poverty alleviation, this crude nostrum of giving more money falls perennially from the lips of those who've made "greed" or "self interest" the bogeyman of all social problems. The trouble is, it's greed and self-interest that drive African leaders to be predatory. It's greed and self-interest that prompts people at the World Bank to double down on their failed projects (they have cushy, well-paid jobs, you know). But it's greed, properly channeled into honest market behavior within good rules that allows societies to grow rich.

Singer is supposed to be a utilitarian. I wish he would be more consequentialist. That is, I wish people who are so puffed up on their own rectitude would see that some pocke of the world is rich or poor due to the systems in which their economic actors operate. Institutions matter. Incentives matter, Entprepreneurship matters. The world doesn't have to be zero-sum. Although this is a less emotionally resonant set of conclusions than any derived from an ethic of self-sacrifice, it takes the real world -- and human nature -- as given.

So I guess the real question for folks like Peter Singer to confront honestly and directly is not why the poor are so poor. But why are rich countries rich?